Echo Boomer is the original name for Millennials, since they (me!) are the children of the Baby Boomers, are a larger generation than the Boomers, and are the largest generation alive today. This generation is having a giant impact on housing trends and needs, as the Boomers did before them. I attended a fantastic class put on by my local Realtor association, presented by Dr Jessica Lautz, the Vice President of Demographics and Behavioral Insights at the National Association of REALTORS®. She gave us a Top 11 trends to watch, most of which are focused on Echo Boomers:
Lack of Affordable Housing Inventory: Long Coastal and big city issue, now it’s nationwide in all areas that affordable homes are not being built, the demand for them is high, and therefore the prices are rising quickly. Getting into a 3 bedroom, 2 bathroom house is expensive, and not getting cheaper anywhere.
Buyers are Swiping Left on Love: or really just skipping the legal wedding. Unmarried couples, single women, single men, and un-romantic twosomes (friends!) are buying houses more and more. The traditional expectation of everyone getting married, then buying a house, then having a baby is no longer the reality, and we will see it less and less over the coming decade.
Care Taking for Pets: Many buyers are not planning on having kids, or at least not for a long time, so pets are a main priority. Think dog parks and windows for cats to gaze out of instead of schools.
Student Loan Debt: It’s a huge issue for buyers of all ages, from those that just graduated, to large loans that take decades to pay off, co-signing on kid’s loans, and going back to school in middle age. This affects what buyers can qualify for, when they can buy, if they can ever buy.
Bank of Mom and Dad: Boomers hold all the money (That means that baby boomer households in 2016 had 12 times the net worth of millennial households.) but they are loaning, gifting, co-signing and buying houses with and for the Echo Boomers. This means that extended family is having a greater input into what and where buyers are deciding to buy.
The Bar Has Risen: HGTV has given buyers an unrealistic standard of what homes will look like. They are not all updated with the cutest or coolest finishes. On the other side, I see sellers also having unrealistic expectations of the market and what buyers are willing and able to do to buy a house. We need to meet in the middle as the market stabilizes.
Tenure is Longer: Buyers are planning on staying in homes 10-20 years, not the 6-7 of a few years ago. Owners are not moving, which also decreases supply and continues to raise prices.
Budding Issues: Recreational and medicinal cannabis is legal in Oregon and Washington, and spreading across the nation quickly. This is having a big affect on commercial and retail real estate, and while I’m not sure why or how this is affecting our market… it’s pretty great! Property managers are putting in marijuana use clauses into leases, so watch out if you are a renter now!
iBuyers: Do you know what they are? Most people don’t! an iBuyer is a real estate company that buys homes from sellers who sign up online. After receiving a description of the property, the iBuyer makes an offer to the seller within a couple days, but it’s usually 13-15% lower than market value. Only about 2% of the small group who fill out the application follow through with it, but as a buyer or seller watch this trend. You may very well buy your house from an iBuyer who did a light flip or will be managing the sale from out of state. This will be similar to buying a bank owned home.
Real Estate Agents are still trusted: Thanks! I have committed 10 years and countless hours to becoming an expert, as have most of my colleagues. Buyer and seller trust in Realtors allows us to act as your agent, and work hard to get you the best deal, in the place you want, in the house you want, without putting our own interests or paychecks even into consideration.
NAR members: 1.4 million Realtors in 2019, a record high! 63% are women. We are all (mostly)independent contractors, so support local women owned businesses
The big takeaway is that Echo Boomers are buying houses. In droves. They are doing it differently than Gen X or Boomers, but home ownership is still a core of the American Dream.